ED attaches Rs 442 crore assets in gaming app case

Hyderabad: The Enforcement Directorate (ED), probing alleged cheating through online gaming applications, has found that Gameskraft Technologies Private Limited and RummyTime Technologies Private Limited invested around Rs 1,000 crore in promoting online real-money games (RMGs), particularly rummy games and tournaments, through mobile applications operating under various brands, including RummyCulture, RummyPrime, Playship and RummyTime.

The ED has attached properties worth Rs 442 crore linked to the RummyCulture app and others under the Prevention of Money Laundering Act (PMLA), 2002. The agency initiated its investigation based on multiple FIRs registered by the Telangana Police in connection with alleged cheating.

According to the ED, the platforms had a user base of around three crore people across the country. A significant number of users were from states where online real-money gaming has been banned, including Telangana, Andhra Pradesh and Tamil Nadu. The companies allegedly generated substantial revenue by charging platform commissions ranging from 10 to 15 per cent on the staking or wagering amounts deposited by users.

In the latest development, the assets attached by the agency comprise fixed-deposit balances, commercial shops, a villa and multiple residential immovable properties held in the names of family members, private family trusts and various associated entities of shareholders of Gameskraft Technologies Pvt Ltd.

The investigation revealed that while assuring users that the gaming platforms were transparent, fair and free from automated players (BOTs), the companies allegedly deployed BOTs against users without their knowledge or consent. The use of BOTs allegedly resulted in substantial financial losses to users while generating proceeds of crime for the companies. The ED also found that the companies adopted deceptive and addictive user acquisition and retention strategies.

The companies spent approximately Rs 1,035 crore on marketing and promotional campaigns to acquire new users, the ED said. New users were allegedly lured through bonuses, referral incentives, free tournament entries and promotional rewards to encourage continuous gameplay and increased deposits.

The proceeds of crime generated through these activities were subsequently layered and integrated through payment of dividends and buyback of shares to shareholders. The proceeds were also allegedly concealed through investments in mutual funds, bonds, convertible notes, equity shares, movable assets and high-value immovable properties, including those held through family trusts and associated entities, and projected as untainted properties.

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Mouli Mareedu

Mouli Mareedu